Can someone explain products liability to me? I just don't get how (402A, Rest. 3d and the california approach) all work together with the consumer expectation test and the ortho risk utility factors. Someone asked in class how do we know when to use negligence or strict products liability and the teacher basically said it depends on the facts and it's up to you. Help?!

The consumer expectation test is for when the danger of the product is beyond the expectation of the consumer. There is an exception for unavoidably dangerous products that have great hazards but important benefits (many prescription drugs).

I think the main way to figure out whether to apply strict liability is to determine the type of defect the product has. When there is a manufacturing defect then the defenses are very limited (no way for manufacturer to take reasonable care, no way to warn), so liability is strict.

Then there are design defects. This is where you can get into negligence because the consumer expectation test and/or risk utility test (where the extent to which the design is more dangerous than alternative designs is examined) can be applied. These are tests where a reasonable standard could be applied, for example a product with an obvious defect could bar a claim for injury occurring from that defect. This is kind of the middle ground and depending on the court strict liability could apply by construing these tests in the plaintiffs favor.

Finally you have failure to give adequate warning about the dangers of the product, which is almost always a reasonableness inquiry, and therefor close to negligence.

Is the California test the hybrid of consumer expectations/risk utility? If so, then the way it works is the risk-utility test is applied for latent defects, while claims on obvious defects are barred by the consumer expectations test.

I think the exception is not about hazards vs. benefits (that would reiterate the risk-utility test) but about the importance of allowing research and development in certain fields without bankrupting them through tort liability.